Contrasting Deutsche Bank (DB) & Old Second Bancorp (OSBC)

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Deutsche Bank (NYSE:DB) and Old Second Bancorp (NASDAQ:OSBC) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their dividends, risk, analyst recommendations, earnings, profitability, institutional ownership and valuation.

Earnings and Valuation

This table compares Deutsche Bank and Old Second Bancorp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Deutsche Bank $43.11 billion 0.52 -$847.72 million ($0.60) -18.20
Old Second Bancorp $117.88 million 3.75 $15.13 million $0.81 18.33

Old Second Bancorp has lower revenue, but higher earnings than Deutsche Bank. Deutsche Bank is trading at a lower price-to-earnings ratio than Old Second Bancorp, indicating that it is currently the more affordable of the two stocks.

Dividends

Old Second Bancorp pays an annual dividend of $0.04 per share and has a dividend yield of 0.3%. Deutsche Bank does not pay a dividend. Old Second Bancorp pays out 4.9% of its earnings in the form of a dividend.

Volatility & Risk

Deutsche Bank has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500. Comparatively, Old Second Bancorp has a beta of 0.64, suggesting that its share price is 36% less volatile than the S&P 500.

Insider & Institutional Ownership

20.9% of Deutsche Bank shares are held by institutional investors. Comparatively, 69.9% of Old Second Bancorp shares are held by institutional investors. 3.2% of Old Second Bancorp shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Deutsche Bank and Old Second Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Deutsche Bank -3.33% -1.85% -0.09%
Old Second Bancorp 16.58% 15.63% 1.30%

Analyst Ratings

This is a breakdown of recent recommendations for Deutsche Bank and Old Second Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Deutsche Bank 4 6 0 0 1.60
Old Second Bancorp 0 0 2 0 3.00

Deutsche Bank currently has a consensus target price of $9.00, indicating a potential downside of 17.58%. Old Second Bancorp has a consensus target price of $18.00, indicating a potential upside of 21.21%. Given Old Second Bancorp’s stronger consensus rating and higher possible upside, analysts plainly believe Old Second Bancorp is more favorable than Deutsche Bank.

Summary

Old Second Bancorp beats Deutsche Bank on 13 of the 16 factors compared between the two stocks.

About Deutsche Bank

Deutsche Bank Aktiengesellschaft provides investment, financial, and related products and services to private individuals, corporate entities, and institutional clients worldwide. It operates through three segments: Corporate & Investment Bank (CIB), Private & Commercial Bank (PCB), and Deutsche Asset Management. The company's CIB segment offers financial market products, such as bonds, equities and equity-linked products, exchange-traded and over-the-counter derivatives, foreign exchange, money market instruments, and structured products. This segment also offers commercial banking, mergers and acquisitions, debt and equity advisory and origination, and cash management services; and trade finance and securities services. Its PCB segment offers payment and current account services, investment and insurance products, deposits, and credit and financing products; mid-cap related products; customized wealth management and investment solutions consisting of discretionary portfolio management, investment advices, and currency and deposit services; start-up and structured financing; interest rate and currency management services; and postal and non-banking services. This segment also offers financing solutions, such as real estate, single-stock, and aircraft financing; and mergers and acquisitions, pre-IPO, private placements, private and public investment solutions, structured lending, and trading and hedging products. In addition, the PCB segment provides wealth structuring, wealth transfer, and philanthropy services. Its Deutsche Asset Management segment invests in equities, fixed income, liquidity, real estate, infrastructure, private equity, and sustainable investments; and delivers alpha and beta solutions. As of December 31, 2017, the company operated 2,425 branches in 60 countries. Deutsche Bank Aktiengesellschaft was founded in 1870 and is headquartered in Frankfurt am Main, Germany.

About Old Second Bancorp

Old Second Bancorp, Inc. operates as a bank holding company for Old Second National Bank that provides a range of banking services. The company accepts demand, NOW, money market, savings, time deposit, individual retirement, and checking accounts, as well as certificate of deposit accounts. It also offers revolving lines of credit for working capital; lending for capital expenditures on manufacturing equipment; lending to small business manufactures, service companies, medical and dental entities, and specialty contractors; commercial real estate loans; construction loans; residential real estate loans, such as residential first mortgage loans, second mortgage loans, and home equity line of credit mortgages; consumer loans, including motor vehicle, home improvement, and signature loans; installment and agricultural loans, as well as student loans; and overdraft checking. In addition, the company provides safe deposit services; trust services; wealth management services; and money orders, cashier's checks, foreign currency, direct deposits, discount brokerage, debit and credit cards, and other services, as well as acquires the U.S. treasury notes and bonds. Further, it offers online and mobile banking; corporate cash management products, including remote and mobile deposits capture, investment sweep accounts, zero balance accounts, automated tax payments, automatic teller machines access, telephone banking, lockbox accounts, automated clearing house transactions, account reconciliation, controlled disbursement, detail and general information reporting, wire transfers, and vault services for currency and coin; and investment, agency, and custodial services for individual, corporate, and not-for-profit clients. The company provides its financial services through its 25 banking locations located in Kane, Kendall, DeKalb, DuPage, LaSalle, Will, and Cook counties in Illinois. Old Second Bancorp, Inc. was founded in 1982 and is headquartered in Aurora, Illinois.

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